Hungary: Electronic court proceedings
By Dr. Attila Kovács, Kovács Réti Szegheõ Attorneys at Law
As of 1 July the rules of the Hungarian Act III of 1952 on the Code of Civil Procedure (“CPC”) provides for comprehensive changes in civil proceedings, including bankruptcy and liquidation procedures. While electronic communication with the court of registration for companies has already been institutionalized in 2008, and while the orders for payment procedures are handled electronically since 2009, the – in most cases – obligatory communication by electronic means in civil proceeding as of 1 July 2015 will be the next step to the “paperless” legal procedures.
To date, in civil actions opened after 1 January 2013 in cases falling within the competence of the general court in the first instance, the party or his representative shall have the option to submit statements of claims and the relevant enclosures also by way of electronic means, in which case all further communication with the court during the procedure of first instance shall be conducted electronically. This means that also the court shall make all deliveries of judicial documents to the party by way of electronic means. Hence until 30 June 2015 it will be an option to choose the way of communication with the court, though pointing out that where petitions and the relevant enclosures are submitted by way of electronic means, it shall be construed as the party’s consent for maintaining communication by way of electronic means.
As of 1 July 2015, in civil actions - and if so prescribed by law in respect of other civil proceedings – the submission of statements of claim, as well as all other submissions and documentary evidence to the court by way of electronic means only, shall be mandatory to economic organizations regardless to the fact whether they are involved as claimant or defendant in the judicial proceeding. The same rules shall apply, if the party is represented by a legal counsel, who shall submit any legal action, as well as all other submissions and documentary evidence to the court by way of electronic means only, through his official port of entry, and the court shall deliver all official documents to the legal counsel electronically as well.
An exemption from the requirement of submission by way of electronic means may be granted in the case of originally paper-based documentary evidence, if such document is to be presented and inspected during the performance of taking of evidence on paper. This shall apply, in particular, if, due to the large quantities of paper-based documentary evidence involved, digitization would impose unreasonable hardship, or if the authenticity of the paper-based document is disputed. On these terms, the court may order submission on paper of its own motion or at the party’s request.
In civil proceedings a party without legal counsel may agree to use electronic service of process, whereby submission of the statement of claim or any other submission by way of electronic means shall be construed as the party’s or the legal counsel’s implicit conduct for agreeing to use electronic service of process in such proceedings. If a party without legal counsel refused to use electronic service of process, and electronic service of process is mandatory for the other party, or the other party did agree to use electronic service of process, the court shall transmit the official documents the other party has submitted, on paper to the party refusing the electronic communication.
With reference to the payment procedure relative to court fees and relative to bankruptcy and liquidation proceedings, also the respective publication (in the official journal) costs that have to be advanced before initiating any proceeding, will be significantly facilitated by a new system allowing payment via credit cards.
As regards electronic communications between courts, and between the court and administrative bodies and other authorities, after 1 July 2015 the courts shall also deliver official documents to other courts and to administrative bodies and other authorities solely by way of electronic means.
With special regard to bankruptcy proceedings, already effective as of 1 January 2015, communications between the court and the parties shall be maintained electronically, in accordance with the above mentioned rules of the CPC. It has to be noted that with respect to natural persons, petitions and other official documents may be submitted, and delivered, on paper as well.
Concerning liquidation procedures – regardless whether the company itself asks for its winding up or the procedure is initiated by a third person ( creditor) – the communication by electronic means with the respective court shall be mandatory as of 1 July 2015 at least for economic organizations and those parties that are represented by a legal counsel.
The electronic service of process is provided by the National Judicial Office through a designated and sophisticated IT system. However, the applicable legal provisions even provide for a presumption of service, because if the party fails to accept the judicial document by the fifth working day following the time of placement on his dedicated hosting service, the judicial document shall be considered served on the next working day!
We are quite positive about the fact that such electronic communication will help to accelerate the above mentioned often lengthy proceedings! With this object, no more escape from the information society in Hungary!
Dr. Attila Kovács
Kovács Réti Szegheõ Attorneys at Law, Budapest, Hungary
T: +361 275 27 85
Dr. Attila Kovács graduated in 1996. After gaining professional experience in Hungarian and German law offices, he is a member of Kovács Réti Szegheő, and has been a Managing Partner since 2004. He speaks Hungarian, English and German and his primary areas of practice are bankruptcy law, real estate law and corporate law.
Kovács Réti Szegheő Attorneys at Law, established in 1992, is one of the oldest independent Hungarian law firms. It is active in Hungarian, English, German and Italian and operates over a wide spectrum within the fields of civil and business law, for both domestic and international clients. Kovács Réti Szegheő Attorneys at Law has gained immersive experience in the fields of corporate law, mergers and acquisitions, construction law, real estate law, securities law, bankruptcy law, labour and employment, competition law and intellectual property law.
published: June 2015